Journalize the following transactions:

January 3:
1. Employees are paid monthly on the first business day of the month for work done in the previous month. The total payroll for the previous month is $110,000. (Ignore payroll taxes for this assignment.) Accounting wrote and distributed the paychecks.
2. GBI received $55,692 in safety product inventory and $37,128 in raw materials from Dallas Bike Basics. This inventory was ordered on December 28. The payment terms for the invoice total of $92,820 are net 10 days. GBI paid the CWX shipping company $550 with a manual check for the shipment of the goods. The bill of lading showed that the safety product inventory arrived in 6 boxes with a total weight of 120 lbs and the raw materials came on a pallet and weighed 100 lbs.
3. Windy City Bikes in Chicago, IL ordered $22,000 of bicycle accessories from GBI. The cost of the accessories (to GBI) is $15,180. The goods were shipped to Windy City immediately via UPS using Windy City’s UPS shipping number. The terms of payment for Windy City’s order are 2/10 net 30 days.
4. GBI received payment of $16,850 from Northwest Bikes in Seattle, WA for the balance due on their account.

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Dryomys Dryomys · Answer 1 · 2020-03-06T11:05:34+01:00

Answer:

The Journal entries are as follows:

(i) On January 3,

Salaries expenses A/c Dr. $110,000

To salaries payable $110,000

(To record the salaries expenses)

(ii) On January 3,

Merchandise inventory A/c Dr. $55,692

Raw material inventory A/c Dr. $37,128

To accounts payable A/c $92,820

(To record the merchandise and raw material)

Shipping cost A/c Dr. $550

To bank A/c $550

(To record the shipping cost)

(iii) On January 3,

Accounts receivables A/c Dr. $22,000

To sales $22,000

(To record the sales on account)

cost of goods sold A/c Dr. $15,180

To Merchandise inventory $15,180

(To record the cost of goods sold)

(iv) Cash A/c Dr. $16,850

To accounts receivables $16,850

(To record the cash received)